order process
Enterprise Systems Configuration for Business
MIS 490
CHAPTER 3
Marketing Information Systems and the Sales Order Process
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Objectives
After completing this chapter, you will be able to:
• Describe the unintegrated sales processes of the fictitious Fitter Snacker company
• Explain why unintegrated Marketing and Sales information systems lead to company-wide inefficiency, higher costs, lost profits, and customer dissatisfaction
• Discuss sales and distribution in the SAP ERP system, and explain how integrated data sharing increases company-wide efficiency
• Describe how SAP ERP processes a standard sales order
• Describe the benefits of customer relationship management (CRM) software
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Introduction
• Fitter Snacker (FS)
• Marketing and Sales (M/S) is the focal point of many of FS’s activities
• FS’s M/S information systems are not well integrated with company’s other information systems
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Overview of Fitter Snacker
• Manufactures and sells two types of nutritious snack bars: • NRG-A: “advanced energy”
• NRG-B: “body building proteins”
• Has organized its sales force into two groups, known as divisions: • Wholesale Division
• Direct Sales Division
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Figure 3-1 The sales process
Fitter Snacker’s Sales Process
Separate system to Manage Inventory
Invoicing System
Accounting System
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Current Processes
• Sales Quotations & Orders
• Order Filling
• Accounting & Invoicing
• Payments & Returns
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Problems with Fitter Snacker’s Sales Process
• Many of Fitter Snacker’s sales orders have problems, such as: • Incorrect pricing
• Excessive calls to the customer for information
• Delays in processing orders
• Missed delivery dates
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Figure 3-1 The sales process
Problems with Fitter Snacker’s Sales
Process (cont’d.)
Separate system to Manage Inventory
Invoicing System
Accounting System
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Accounting and Invoicing
Current Invoicing Process:
• Sales clerks send the Accounting department the sales order data for customer invoices
• Accounting department loads the data into PC-based accounting program
• Clerks manually make adjustments for partial shipments and any other changes
• Sometimes, order corrections are delayed and don’t catch up to the invoicing process
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Sales and Distribution in ERP
• ERP systems can minimize data entry errors and provide accurate information in real time to all users
• ERP systems can track all transactions (such as invoices, packing lists, RMA numbers, and payments) involved in the sales order
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Pre-Sales Activities
• Customers can get pricing information about the company’s products
• Marketing activities such as tracking customer contacts, including sales calls, visits, and mailings
• Company can maintain data about customers and generate mailing lists based on specific customer characteristics
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Sales Order Processing
• Sales order can start from a quotation or inquiry generated in the pre- sales step
• Information collected from the customer to support the quotation is immediately included in sales order
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Inventory Sourcing
• Available-to-Promise (ATP) check
• System can recommend an increase in planned production if a shortfall is expected
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Delivery
• Delivery in SAP ERP system means releasing the documents that the warehouse uses to pick, pack, and ship orders
• Delivery process allows deliveries to be created so that the warehouse and shipping activities are carried out efficiently
• Once the system has created documents for picking, packing, and shipping, documents are transferred to Materials Management module
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Billing
• SAP ERP system creates an invoice by copying sales order data into the invoice document
• Accounting can print this document and mail it, fax it, or transmit it electronically to the customer
• Accounting records are updated at this point
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Payment
• When the customer sends in a payment, it is automatically processed by the SAP ERP system
• Timely recording of this transaction has an effect on the timeliness and accuracy of any subsequent credit checks for the customer
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Discount Pricing in SAP ERP
• When a company installs an ERP system, it can configure it for a number of pricing strategies
• Various kinds of discounts can be allowed
• As a safeguard, system can enforce limits on the size of discounts
• Condition technique • Control mechanism developed by
SAP to accommodate various ways that companies offer price discounts
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Customer Relationship Management
• Companies without a good connection between their workers and their customers run the risk of loosing business
• Customer relationship management (CRM) software can help companies streamline their interactions with customers
• On-demand CRM: software and computer equipment reside with CRM provider
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Core CRM Activities
• One-to-one marketing
• Sales force automation (SFA)
• Sales campaign management
• Marketing encyclopedias
• Call center automation
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CRM Processes
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The Benefits of CRM
• Lower costs
• Higher revenue
• Improved strategy and performance measurement
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